The Research On Effect Of The Asset Divestiture Of YuanDa Environmental-Protection

The benign development of an enterprise has two important and relative ways,namely,asset divestiture and expansion mergers and acquisitions.Asset divestiture has gained pragmatism and attention from western financial researchers,with the merging of western developed countries the theory developed.Asset divestiture has unparalleled advantages in three aspects: At first,it can optimize the allocation of market economy resources;Secondly,it will revitalize the stock of assets;Third one,it can adjust the industrial structure.Asset divestiture can play a promoting role in maintaining and increasing the value of state-owned assets,transforming business mechanism,deepening internal reform and healthy development of enterprises.This paper took YuanDa Environmental-Protection Co.Ltd as a case and take the case study method as the research tool.At first,this paper elaborated the domestic and foreign study of asset stripping,and analyzed the background and motivation of asset stripping.Then,the paper measuring the performance of asset divestiture from two aspects——the main business development and the financial performance(which reflect the impact of core competence and the impact on the company's business performance respectively).This paper evaluated the role of asset divestiture in the development of the company's core competitiveness from the aspects of its main business structure,contribution rate of main business,and main business gross margin.After that,this paper gave an analysis and a evaluation on the financial impact of asset divestment from four aspects——profitability,solvency,development and operational capacity.In order to comprehensively evaluate the effect of the asset divestiture,this article also used EVA to evaluate the Yuan Da's ability of creating value.The analysis above found that the asset divestiture of Yuan Da had got an overall success,while the market environments influences of different business and the growing company operating costs still need to be solved by the company.At last,This article means to provid recommendations from a practical research for the enterprises which plan to transform business by using asset divestiture.The purpose of this study is making the implementation of asset divestiture more effective,optimizing resource allocation and enhancing the company's core competitiveness.